Now Comes the Hard Part

By

Thomas G. Donlan

November 23, 2013

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Does anything more than political passion account for so many Republicans' fear and loathing of the Patient Protection and Affordable Care Act? President Barack Obama often dismisses objections to his signature health-insurance plan as just an example of the partisan hostility that gets in his way.

Describing the conflict, the president sees "this incredible organized effort to block the notion that everybody should have affordable health care in this country."

If that were the issue, Obama might be right. But opposition to Obamacare has less to do with affordable health care and more to do with unaffordable burdens. It does not significantly change the U.S. health-care system; it adds another unneeded layer of economic fantasy.

In the zero-sum game of contemporary politics, partisanship does loom large. But Obamacare has the opposition it deserves.

Reformers' Heritage

Obama frequently complains that the Democrats who drafted the law took many of the important elements from past Republican proposals. He asks: Why were there no Republican votes in Congress for ideas some of them had supported in the past?

He's right to ask. But he may not like one of the most important answers: Like so many other schemes left over from the era of Teddy Roosevelt, Obamacare is impractical. It springs from a long bipartisan tradition of kidding the public about health care and health insurance.

Another name for Obamacare could be Nixoncare. In February 1974, President Richard M. Nixon presented a plan for universal health insurance that, like Obamacare, featured a mandate for employers to provide health insurance to their full-time employees, a mandate for individuals without employer insurance to buy it, and continuation of the Medicare program. Unlike Obamacare, Nixoncare would have replaced the Medicaid program with private insurance paid for by the feds for those who could not afford it.

Like Obamacare, the Nixon plan offered guaranteed access to coverage for the sick and healthy alike; equal rates for the young and old; a cap on out-of-pocket expenses; and a long list of mandated minimum benefits, many of them free of charge to the patients. It guaranteed that patients could choose their health-insurance company and their health-care providers, and that doctors could prescribe all the care that they believed patients needed. So, like Obamacare, the Nixon plan had cost controls, quality controls, and national standards of care -- federal control of 8% of the economy.

Nixon also said his comprehensive program would require no new taxes, a highly doubtful proposition reminding us of the double-counting and hidden taxes that made the Care Act look Affordable.

Unfortunately for Nixon and for the other Americans who admired the idea of universal health insurance, Congress and most of the American people weren't ready for it, and they were already fed up with Nixon. All they wanted to hear from him was an admission of guilt in Watergate and the fateful words of resignation as president.

Maybe Nixon got away lucky at that. Had the plumbers never been caught bugging, and had the White House not needed to cover it up, the Democratic Congress of 1974 might have passed the Nixon plan, and his administration would have had to figure out how to make it work.

The Hard Part

As the Obama administration is still finding out, it's a challenge to remake an industry that's now 16% of the economy. The president himself said recently, "Let's face it, a lot of us didn't realize that passing the law was the easy part."

That applies particularly well to the easy parts of the Affordable Care Act. The president listed some recently: "No more discriminating against kids with pre-existing conditions. No more dropping your policy when you get sick. No more lifetime limits on the care that you can receive. All of that and more is part of a new Patient's Bill of Rights that's smack-dab in the middle of the Affordable Care Act, and it's helping people right now....There are three million young adults under the age of 26 that are getting coverage by staying on their parents' plans right now. More than 100 million Americans have gotten free preventive care like mammograms and contraceptive care with no co-pays. Millions of seniors on Medicare have saved hundreds of dollars on their prescription medicine. It's already happened. They may not be aware of it, but that's already taking place."

All of these elements are significant and much admired by those who benefit, but they were easy to implement because nobody is paying for them directly. That's the hard part, still to come. Official estimates say Obamacare will cost more than $200 billion a year once it gets going. Serious reformers should expect that it will cost much more.

Ready or Not

Obama recently noted with pride, "Millions of Americans will soon know the security of health care, in some cases for the first time, in states where governors have chosen to expand Medicaid under the Affordable Care Act." That proviso will take effect on Jan. 1 (in only 25 states, because the U.S. Supreme Court ruled that Congress could not force the states to let more people into their state Medicaid programs).

This is the one part of the act that is clear about financing, because Medicaid is a clear welfare program. Federal taxpayers and Treasury bond-buyers will pick up the whole cost for three years, and Congress promises to keep paying at least 90% thereafter.

Putting more people on Medicaid is at the core of Obamacare. It may become the fall-back position when the disruption of private individual insurance becomes intolerable. Then we will know who pays for it.

Insurance reforms that would work include ending state-by-state regulation, including abolition of state coverage mandates and price controls. Congress might simply allow health insurance to be sold across state lines so there can be effective competition.

With a reform like this (for a lark, we might call it Coolidgecare), even President Obama and his Republican antagonists could find the path to bipartisanship.

Now Comes the Hard Part

Does anything more than political passion account for so many Republicans' fear and loathing of the Patient Protection and Affordable Care Act? President Barack Obama often dismisses objections to his signature health-insurance plan as just an example of the partisan hostility that gets in his way.

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